VAT for E-Commerce Sellers and Online Marketplaces in Nepal

Who supplies what?

Determine whether the platform sells as principal or connects a third-party seller. Map product sale, commission, advertising, payment and delivery as separate supplies with separate counterparties.

Invoice at the right level

The customer invoice should identify the actual supplier. The platform’s commission invoice belongs between platform and seller; it should not silently replace the seller’s product invoice.

Reconcile payment flows

Gross orders, cancellations, discounts, delivery fees, platform deductions and net bank settlements need an order-level bridge. Cash-on-delivery does not remove VAT timing or invoice obligations.

Control returns and promotions

Link returned goods and promotional subsidies to the original order. Establish whether a discount is funded by seller or platform and how it affects taxable value.

A practical control to retain

Build an order reconciliation with seller, invoice, gross price, VAT class, promotion, return, delivery charge, commission, withholding and payout. Totals should bridge marketplace dashboards to bank receipts and each legal entity’s ledger. Test who bears coupons and refunds in the contract. If the platform holds inventory or controls pricing, revisit whether it is acting only as an intermediary rather than assuming the label used in marketing.

For online sellers, marketplaces and fulfilment businesses, the sign-off should answer the guide's four core questions in writing: Identify the legal seller for every order. Platform commission and product sale are separate supplies. Cash-on-delivery still needs invoice reconciliation. Returns must connect to the original order. Record who checked those answers, the source date and any unresolved fact. If a later invoice, contract or Schedule amendment changes one answer, reopen the classification or return treatment instead of silently carrying the old assumption forward.